Social Media

executive vice president, Astec Analytics, SunGard's capital markets business

Securities Lending: Eyes on Facebook and Zynga

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Viewing the movement of securities lending volumes and prices for stocks during the day can provide a detailed picture of market sentiment on a minute-by-minute basis. This can be especially useful after a major announcement.

It is apparent that the price movements and market sentiment responses to corporate news are more immediate with social media associated stocks than they are with traditional manufacturing companies. Perhaps this is not so surprising given the will o’ the wisp nature of the former. At the end of the day, if Caterpillar is in trouble, you have a stockpile of large dumpers and diggers to play with in your personal sandbox, but what have you got with Internet and social media companies?

Today, the arcane market of securities lending watched for Facebook’s first earnings announcement. Facebook’s stock price was affected by the poor results from Zynga yesterday on July 25, but what were the short sellers going to do?

Well, writing at midday Thursday, July 26, the early morning was quite slow to get going, which was remarkable for its “unremarkableness.” Certainly, there was not much borrowing of shares to support increased short selling activity in either Zynga or Facebook by mid-morning. However, things have started to move since then.

By lunchtime, according to our real-time data, the cost of borrowing Zynga shares had doubled to about 1% per annum as had the cost to borrow Facebook, which rose to 0.85% per annum. In addition, the volume borrowed of Zynga shares had increased by nearly 2 million shares on an already outstanding borrowed volume of about 20 million. While not as large an increase was seen in Facebook volumes, it was ticking up slightly.

It remains to be seen what might happen following Facebook’s announcement after the close of trading.

While you’re here…

director of research, Astec Analytics, SunGard's capital markets business

A LENS ON FACEBOOK’S FIRST DAYS OF TRADING

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This blog post also appears on TabbFORUM.

Facebook’s problems on its first day of trading had many brokers concerned about their ability to borrow shares on Wednesday to settle short sales. Therefore, on Tuesday, as some institutional investors received shares early in the allocation process, brokers borrowed 26 million Facebook shares at a costly 40% annual interest rate. However, on Wednesday, a flood of lendable shares sent borrowing costs for Facebook shares down 80%. Another 28 million FB shares were borrowed at these lower rates on Wednesday.  On Thursday, brokers borrowed another 10 million shares but returned 9 million, for a net additional 1 million shares borrowed.

When options trading begins in Facebook shares next week on the Chicago Board Options Exchange (CBOE), market makers will need to borrow and short Facebook shares in order to hedge the options that they write. If the supply of lendable Facebook shares was tight and borrowing costs were high, options would be priced more richly and market makers would have a bit harder time facilitating a market because it would be more difficult to find borrowable shares. The CBOE usually waits longer after an IPO to begin trading options, and given the problems at NASDAQ on Friday, one would think that the CBOE would be extra cautious. An improvement in the ability to borrow shares in the securities lending market should ease some of those concerns.

Shorting a high P/E stock such as Facebook, despite the recent correction in its share price, is still dangerous because long investors are purchasing shares to participate in future growth, which is currently indeterminate. It’s hard to imagine it now based on the problematic first week of trading, but a piece of unexpected good news could cause investors to jump back in and send Facebook shares shooting upward. Short sellers must also be cognizant of macro-level developments, particularly at the central bank level, that may encourage savers to rotate more money into risky assets such as Facebook stock. On the other hand, a deflationary environment could set up a high P/E stock such as Facebook for a swift fall.

Further in the future, when indexes begin to include FB, there will be support from index tracking funds. But S&P requires that “initial public offerings should be seasoned for 6 to 12 months before being considered for addition to an index.” Russell and Wilshire may add FB sooner than that, but it’s difficult to quantify the impact of index inclusion, especially when paired with bearish events that will take place in the future, such as the end of the lockup period when the overhang of stock is dumped onto the market.

Stay tuned, as this story is only beginning.

While you’re here…

deputy head of strategy, SunGard’s capital markets business

Q&A: TRANSFORMING POST-TRADE PROCESSING

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I recently participated in another Twitterview with DerivSource, who asked me several questions about transformations happening in the post-trade processing space. Within the context of regulatory reform, firms are recognizing the need to make changes to meet new rules, both those that have been identified and those still to be determined.

In the Q&A, we talked about data management, collateral management, approaches to regulatory compliance, and more. One of the most important ideas that came across is the concern that firms may be planning to respond to regulations one by one rather than equipping themselves with the ability to address multiple regulations in a flexible way.

If you missed the Twitterview, you can see the full back-and-forth with DerivSource here or you can search the #PTderiv hashtag on Twitter to find the full Q&A and add your own comments to the conversation.

TWITTERVIEW: TRANSFORMING POST-TRADE PROCESSING

DERIVSOURCE: With regulatory reform still in flux, how can firms start transforming post-trade processes to participate in the new OTC space? #PTderiv

TONY SCIANNA: Firms should take long-term view of regulatory reqs & impact on middle & back office, not just one-off challenges… Invest in #posttrade processes based on the big picture of increasing transparency & reducing systemic risk #PTderiv

DERIVSOURCE: What is the one post-trade ops area firms can start making changes to now to meet new regulatory rules and why? #PTderiv

TONY SCIANNA: No surprises from me: improving #datamanagement is the key to supporting regulatory demands. #PTderiv

DERIVSOURCE: What post-trade ops function faces the most significant transformation and why? #PTderiv

TONY SCIANNA: Hard to pick just one – data mgmt, #collateralmanagement, credit / risk mgmt, connectivity… New market structures, regulations, clearing of OTC #derivatives, etc. all require new approaches to #posttrade #PTderiv

DERIVSOURCE: Focusing on some specific post-trade processes, how can firms improve data mgmt in light of reg reform & new market structures? #PTderiv

TONY SCIANNA: Firms should be investing in capturing real time transactions across their disparate enterprise, standardize the data & … ensure the data can be readily accessible 24/7 for management reporting & any future regulatory demands #PTderiv

DERIVSOURCE: What about connectivity to new market structures like #SEFs #OTFs #SDRs & #CCPs? How can firms cope w/ connectivity complexity? #PTderiv

TONY SCIANNA: Ability to connect to new market structures, like data capture, must be flexible so firms can adapt to new requirements #PTderiv

DERIVSOURCE: Can firms process clearable #swaps and bilateral #derivatives in tandem efficiently? What are the challenges? #PTderiv

TONY SCIANNA: This is a challenge for back office ops. Firms will likely keep bilateral contracts & clearable swaps on separate apps… And all these applications will need added functionality for execution, matching &reporting #PTderiv

DERIVSOURCE: Collateral mgmt will transform in the new OTC #posttrade space. What is your customers’ biggest concern re: collateral mgmt? #PTderiv

TONY SCIANNA: A big focus on enterprise-wide collateral management &optimization will be crucial for market participants going forward… Firms will need a solution that allows them to select most efficient type of collateral to meet its collateral obligations #PTderiv

DERIVSOURCE: How can the CCPs help firms manage collateral when clearing various products across multiple jurisdictions? #PTderiv

TONY SCIANNA: The market requires additional clarification on what type of collateral will be eligible for use… by various CCPs before optimization strategies can be firmly established #PTderiv

DERIVSOURCE: Are you concerned about a ‘rush’ for technology from firms waiting for regulatory clarification before preparing post-trade ops? #PTderiv

TONY SCIANNA: Concerned about firms trying to respond to regulatory change 1 requirement at a time instead of preparing for the big picture… Firms must try to prepare for not just 1 rule but for ability to address multiple rules that will be introduced over time …#PTderiv

DERIVSOURCE: What is the biggest opportunity for the post-trade space in light of the regulatory change? #PTderiv

TONY SCIANNA: Reporting on transactions will be a necessity not just for bilateral contracts & clearable swaps but for all asset classes…#PTderiv

While you’re here…

vice president, risk solutions, SunGard's capital markets business

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Q&A: HOW WILL RISK MANAGEMENT CHANGE TO SUPPORT THE NEW OTC DERIVATIVES MODEL?

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Last week I participated in a webinar and a Twitterview with DerivSource, covering the changing landscape of risk management in the new OTC derivatives workflow model.  It goes without saying that risk is at the center of regulatory reform; the new world of risk management must develop to meet the new requirements and challenges facing the OTC derivatives markets.

During the Twitterview in particular, DerivSource boiled down several big questions about drivers of change with regard to risk management today. It’s amazing how much you can actually discuss in a few simple tweets. This Twitterview, under the #derivrisk hashtag, touches on drivers and changes to risk management in the OTC derivatives markets, credit valuation adjustment (CVA), risk with relation to CCPs and potential strains on liquidity, the role of “real time” in risk, and more.

If you missed this risk management Twitterview with DerivSource, search #derivrisk or follow the full Q&A below. And as always, if you have your own questions about risk management in the changing OTC derivatives landscape, leave me a comment or ask me on Twitter to continue the conversation.

QUESTION: What is the biggest driver for risk mgmt improvements – transparency requirements or new risk in the new OTC model? #derivrisk

MARCUSCREERISK: New risks in the OTC clearing space are a far bigger driver for risk mgmt in my opinion…The FCM world is facing longer tenors, and more complexity than it has hitherto known #derivrisk

QUESTION: What is the biggest change impacting pre-trade risk mgmt for firms participating in the new OTC derivatives market? #derivrisk

MARCUSCREERISK: Understanding the longer term impact on the portfolio, and on the margin requirements, of any new trade… A deteriorating position in a longer dated trade could cause serious liquidity issues #derivrisk

QUESTION: How are firms improving market risk mgmt to support the new OTC derivatives model? #derivrisk

MARCUSCREERISK: We are seeing a great deal of proactive improvements w/ firms looking to… Leverage the risk experiences of the bilateral world and to tightly manage VaR driven margin requirements #derivrisk

QUESTION: What challenges do firms face in improving credit risk mgmt to support the new OTC model? #derivrisk

MARCUSCREERISK: Credit risk is less of an issue w/ central clearing. It’s replaced by potentially more dangerous liquidity risk… Credit risk remains central focus for bilateral trading, w/ firms bolstering collateral management & CVA measurement #derivrisk

QUESTION: What about credit valuation adjustment activities (CVA)? What is the driver behind improvements to #CVA activities? #derivrisk

MARCUSCREERISK: Controlling #CVA on bilateral trading enables front office to directly control its credit risk profile… It’s also interesting how different models are emerging from advisory to CVA-specific trading desks #derivrisk

QUESTION: Clearing via CCPs for some swaps introduces new liquidity strains. How will risk mgmt change to mitigate new liquidity risks? #derivrisk

MARCUSCREERISK: Since margins are determined, in part, by VaR-based models, firms can approximate & stress expected margins… This is the foundation of a working #riskculture and the best defense against liquidity risks #derivrisk

QUESTION: Is real-time risk management necessary to support trading and clearing OTC derivatives going forward? #derivrisk

MARCUSCREERISK: Real time is an interesting topic. The risk that cleared OTC trades carry is liquidity/margin based… Margin is driven by VaR models, using clean end-of-day data. As new trades enter portfolios, they need… to be reflected as they happen, but real time pricing has a far smaller impact #derivrisk

QUESTION: Enterprise-wide risk mgmt – a buzz term or necessity to support newly regulated OTC market? #derivrisk

MARCUSCREERISK: This was, is and should continue to be the focus and aim of all financial firms… Risk taking is what firms do. Understanding risk at all levels is vital 4 controlling biz & underlying risk takers within biz #derivrisk

QUESTION: What advice would you give a CRO struggling to make sense of how risk mgmt will change in the new OTC derivatives market? #derivrisk

MARCUSCREERISK: Call @SunGard! Seriously, the key is “risk” has not really changed at all. Best practice has become regulation… and to a certain extent, liquidity risk has been increased at the cost of decreasing credit risk… The need for a strong risk culture underpinning the firm has always been there, now it’s just more obvious #derivrisk

 

deputy head of strategy, SunGard’s capital markets business

TRENDS IN OTC DERIVATIVES: TWITTERVIEW WITH DERIVSOURCE, TABB GROUP AND SUNGARD

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With trends in OTC derivatives in mind, we recently held a Twitterview with DerivSource and Kevin McPartland of TABB Group to delve into the topic a bit more. We discussed the rising cost of participation in the OTC space, the data management imperative, and balancing IT budgets given the continued uncertainty around new rules.

I’ve included the full panel-style Twitter discussion below. If you have your own questions, leave a comment or send a tweet to me, Kevin McPartland or DerivSource.

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DERIVSOURCE:
Cost of participation in OTC markets will rise; how will firms evaluate if they should exit this space due to higher cost? #TENfs

KMCPARTLAND: For most it’s simple ROI analysis – will upfront costs yield substantial profits? For others it’s cost of staying in the game at all #TENfs

TONYSCIANNA: Firms will need to do cost & risk analysis to determine whether or not it’s still cost-effective to be in markets they’re in #TENfs

DERIVSOURCE:
With electronic trading landscape still in flux, what challenges does industry face to reduce costs and improve returns? #TENfs

KMCPARTLAND: Many on the buy side will rely on their brokers to do the legwork –technology, compliance, etc. … For the dealers, it’s about designing the right business model based on what we know now #TENfs

TONYSCIANNA: It’s about creating transparency and liquidity. If you can get these things right, you will automatically reduce costs #TENfs

DERIVSOURCE:
How will firms cope w/ margin & liquidity squeeze clearing will introduce? What should firms change now to prepare? #TENfs

KMCPARTLAND: Margin financing, collateral optimization and other similar services are in high demand, and their use will grow. This will help reduce buy-side margin needs and help dealers make money around clearing #TENfs

TONYSCIANNA: Firms should work on collateral optimization for clearinghouses with major banks to provide their clients with optimized CM #TENfs

DERIVSOURCE:
Why should firms focus on enterprise data management now? How can firms improve agg of data across silos in cost efficient way? #TENfs

TONYSCIANNA: It’s a must. Firms will need to capture, standardize & have access to data across enterprise in real time http://ow.ly/6wt4q #TENfs

KMCPARTLAND: @tabbgroup sees transaction volume could grow 20 fold – related data even more. Waiting to deal with this is not an option #TENfs

DERIVSOURCE:
How will firms balance tight IT budget w/ onslaught of new reg requirements & uncertain timeframe for implementation? #TENfs

TONYSCIANNA: A lot of firms will seek point solutions as reqs are issued. We see larger firms taking a more enterprise-wide approach #TENfs

KMCPARTLAND: Some firms are deciding not to offer client clearing. The payback was not seen as justifying the cost… Others in the 2nd tier will take a wait-and-see approach to limit unnecessary work #TENfs

DERIVSOURCE:
Is there a silver lining to the transformation taking place in the OTC space for firms & the industry at large? #TENfs

KMCPARTLAND: OTC #derivatives reform will ultimately be good for the industry. The rules overreach in some parts, but … more automation and open access will ultimately improve liquidity and pricing #TENfs

TONYSCIANNA: Clearly the intent of transparency & reduction of systemic risk will benefit the industry, though will take awhile to get there… Industry coming together to create standards & reduce systemic risk is ultimately a good thing #TENfs

vice president, business integration, Protegent, SunGard's capital markets business

FINRA NOTICE 11-39: INTERPRETING THE NEW U.S. SOCIAL MEDIA GUIDELINES FOR SECURITIES FIRMS

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By Suman Garhwal, Vice President – Business Integration, SunGard Protegent

In mid August, FINRA issued a much awaited follow up to its notice 10-06 regarding securities firms use of social media. This guidance was issued in the form of notice 11-39 (FINRA Notice 11-39) which is an effort to provide additional direction on how firms can use social media as part of their business strategy. A large part of such a strategy is the use of social media by the field. Since FINRA issued notice 10-06 (FINRA Notice 10-06) about 18 months ago, there have been a lot of questions in the industry regarding its interpretation. This had led to firms not completely opening up with their strategy on social media.

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vice president, risk solutions, SunGard's capital markets business

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ENTERPRISE RISK MANAGEMENT: TECHNOLOGY AS A CULTURAL ENABLER

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On Tuesday, I participated in a risk-themed Twitterview with Michael Versace, director of global risk at IDC-Financial Insights (@versace57) and Virginie O’Shea, managing editor at A-Team Group (@virginieateam).

Virginie posed several interesting questions to Michael and me, covering technological and cultural challenges and approaches to enterprise risk management. Within the boundaries of Twitter, we had a meaningful discussion around internal governance, the importance of risk empowerment, and how to capitalize on industry changes and take action now.

If you missed the #riskchat Twitterview, you can Read more»

deputy head of strategy, SunGard’s capital markets business

FINANCIAL REGULATORY REFORM: A TWITTERVIEW WITH JOHN LOTHIAN

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Author: Tony Scianna, deputy head of strategy, SunGard

Today I participated in a Twitterview – a real-time interview via Twitter – with John Lothian, owner of John J. Lothian & Company, Inc. and founder of the John Lothian Newsletter and MarketsWiki. As SunGard’s New York City Day is around the corner and we are both speaking on panels focusing on financial regulatory reform, we thought it would be fun to give a preview of some of the hot topics on Twitter.

During the Twitterview, John asked me about global regulatory reform and asked some big questions regarding what market participants should be focusing on and what might happen due to delays in rulemaking. John opened the interview by asking me, “What are the biggest questions on people’s minds today about regulatory reform?” How would you have answered that question?

If you missed the Twitterview when it happened live, you can read the interview here or in Twitter Search under #TENfs. And if you have your own answer to one of the questions or want to ask something new, leave a comment for us below.

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John Lothian: Let’s get started with today’s #TENfs Twitterview with @tonyscianna

Tony Scianna: Thanks @JohnLothian, let’s get to the questions #TENfs

John: What are the biggest questions on people’s minds today about regulatory reform? #TENfs

Tony: The questions are still around uncertainty, timing and guidance. Firms want to know how to plan. #TENfs

John: How prepared – or not prepared – are market participants for the new rules? #TENfs

Tony: TABB found only 40% firms trading OTC deriv are prepping for #finreg http://bit.ly/ifRKX Over time, what will this # turn into? #TENfs

John: What about delays for #derivatives rules? How will this affect firms’ regulatory readiness? #TENfs

Tony: The question is how long can lawmakers say “hurry up & wait” before firms “hurry up” and focus on other priorities? #TENfs

John: What are some critical areas where firms need to better prepare for #finreg? #TENfs

Tony: In my opinion, critical areas are management, collection of, access to data that regulators will need #TENfs

John: Amidst the uncertainty and change, what opportunities are there for market participants? #TENfs

Tony: Big changes can bring about new innovation. However, time will tell where the real opportunities are. #TENfs

John: What do you believe the next few years will bring? What will our global financial markets look like? #TENfs

Tony: Wouldn’t it be nice to have a crystal ball! I do believe regulators must strive to grasp increasing globalization of industry #TENfs …

Tony: …and focus on taking this time to get it right. #finreg #TENfs

John: Recent @TabbFORUM study found “Regulatory uncertainty cited as key factor in lack of preparation.” How can firms gain clarity? #TENfs

Tony: The most useful ways to gain clarity are by listening to industry groups & participating directly wherever you can #TENfs

John: I know we’ll all be in #NYC for SunGard New York City Day on June 20. What are you speaking about at the event? #TENfs

Tony: Pre- to post-trade implementation of #DoddFrank & global financial reform: http://ow.ly/5hquP #TENfs

John: Great, @tonyscianna. I’m speaking re #DoddFrank in context of risk management. See you there http://bit.ly/iAHutd #TENfs

Tony: Thanks for interviewing me today @JohnLothian. See you on Monday for New York City Day #TENfs

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While you’re here…

deputy head of strategy, SunGard’s capital markets business

OTC DERIVATIVES AND THE QUESTION OF WHEN

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Author: Tony Scianna, executive vice president, SunGard

It had been a while since I participated in a Twitterview – a real-time interview via Twitter – so I was glad to have the opportunity to join TABB Group’s senior analyst Kevin McPartland in yesterday’s “DerivChat” conversation. SunGard’s own director of analyst relations, Alyssa Gilmore, moderated the discussion, which focused on OTC derivatives.

During the Twitterview, Kevin and I discussed the topic of OTC derivatives in the context of his recent article on TabbFORUM titled, “OTC Derivatives: Not What, But When.” We talked about business and technology challenges, as well as our thoughts on timing and preparedness. There is no doubt this is a topic that we’ll continue watching and discussing throughout the year and beyond, as regulatory requirements become clearer and new regulations are announced.

If you didn’t see it happening in real time, you can read the interview here or in Twitter Search under #derivchat. And if you have your own answer to one of the questions or want to ask something new, leave a comment for us below.

Alyssa4AR: Welcome to #derivchat! Today we’ll be talking with @kmcpartland of @TabbFORUM and @tonyscianna of @SGBrokerage at SunGard.

Alyssa4AR: Follow the #derivchat conversation by using the hashtag. Thanks for joining, @kmcpartland & @tonyscianna. Ready to get started?

Kmcpartland: Glad to be part of #derivchat, @Alyssa4AR. Looking forward to discussing OTC #derivatives today with you and @tonyscianna

Tonyscianna: Likewise, @kmcpartland @Alyssa4AR. Let’s get started #derivchat

Alyssa4AR: Let’s jump right in. @kmcpartland, you recently wrote: OTC Derivatives: Not What, But When. What makes “when?” such a big Q? #derivchat

Kmcpartland: They will finish most of the rules on time, but the implementation times are up in the air. Q1 2012 we will start to see change. #derivchat

Tonyscianna: I agree. In my opinion, the regulators will move forward faster then we expect and require some form of compliance by 2012. #derivchat

Alyssa4AR: And there is a lot to accomplish btwn now & 2012. What are some of the key business challenges re: central clearing of OTC? #derivchat

Tonyscianna: Firms need to be able to capture data, normalize it and access it in real-time or near real-time … #derivchat

Tonyscianna: …to meet reqs such as intraday reporting. But a lot of info is locked in legacy systems & silos and batch processes #derivchat

Kmcpartland: Then there is connectivity to CCPs, SEFs and the new data sources @tonyscianna mentioned.  #derivchat

Alyssa4AR: With the “when” now on the horizon, what needs to be done in terms of technology? #derivchat

Tonyscianna: Firms need to align tech w/new reg reqs, & be able to not only get info in real-time but cross-reference data from mult sources #derivchat

Kmcpartland: Most of this falls on the brokers. PB platforms, execution platforms, the clearing infrastructure. All need major revamps… #derivchat

Kmcpartland: …Buy side clients are depending on their brokers in this regard. #derivchat

Alyssa4AR: From @CFTC O’Malia: So Many Regulations, So Little Time http://on.wsj.com/haMvcX. What does this mean for firms asking “when?” #derivchat

Kmcpartland: O’Malia recognizes importance of these rules & doesn’t want to rush. Politics say they’ll hit deadlines for most things though. #derivchat

Tonyscianna: Also means you need to build your enterprise data management solution NOW to be prepared. #derivchat

Tonyscianna: Soon, no matter where you are or what regs apply to you, you’ll need to report every transaction & it can’t be a week later #derivchat

Kmcpartland: And this is global. Europe isn’t as far behind as some think. The MiFID Review will require major changes as well #derivchat

Alyssa4AR: Keeping with the theme of “when,” let’s fast forward to next year. What will we be talking about in 2012? #derivchat

Tonyscianna: Don’t know what new challenges will come up, but believe we’ll be talking about same issues but w/ more clarity from regulators #derivchat

Kmcpartland: Hopefully we’ll be talking about how liquid the vanilla swaps market has become, and which SEF has the liquidity! #derivchat

Alyssa4AR: That closes #derivchat! Thanks to @kmcpartland and @tonyscianna and everyone who followed.

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SOCIAL MEDIA AND THE COLLABORATIVE CULTURE

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Author: Gerry Murphy, former president, SunGard

Lately I have been thinking more and more about how to best use social media and the many new collaborative communication technologies that are available today. For me, social media extends into many different spheres, including innovation, service, organizational culture and diversity. It is about finding and embracing new and more efficient ways to collaborate, create and work more productively as a business.

We are already seeing significant adoption of new communication technologies within our organization, such as Yammer, secure instant messaging and real-time video sharing. I firmly believe that the adoption of and potential for social media will only grow in the coming years.

Recently, SunGard’s CEO Cristóbal Conde spoke at a conference organized by the Economist about this topic, and his talk was captured in a blog post. Cris gets to the heart of what it means to create a “collaborative culture” stemming from the availability of new communication tools that have created what he calls an “idea ecosystem.” I want to share part of his talk here, as it echoes some of my own beliefs about where we are headed in terms of social media and business.

Now, an important culture shift has taken place as information technology revolutionized the way people communicate, gain knowledge and work. In turn, it’s created a new “idea ecosystem” that has unlocked a massive reserve of human potential and, just as important, growth, for corporations.

…

Creating a collaborative culture is also a challenge that requires the right mindset and tools to flourish. Why should people collaborate? How do leaders establish a collaborative spirit in dispersed, competitive environments? In truth, the how is much simpler: by using tools that enable rapid communication, like email, Yammer, Twitter and other social media platforms that allow people to talk to each other quickly and trade ideas that they can develop into decisions.

Read the article in its entirety here: How flattening your company multiplies intelligence.

What are your thoughts on a collaborative business culture? What are the greatest challenges arising from this shift? What is the role of social media in all of this?